If Demand Is Inelastic and the Price of a Product

question 1

Multiple Choice

If demand is inelastic and the price of a product decreases by 100 percent, then

• A) the change in quantity demanded is less than 100 percent.
• B) the change in quantity demanded is equal to 100 percent.
• C) the change in quantity demanded is greater than 100 percent.
• D) the decrease in quantity demanded is greater than 0 percent.

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Definitions:

Labor

The human effort, whether physical or mental, used in the production of goods and services.

Output

The total amount of goods or services produced by a firm, industry, or economy.

Cost

The total expenditure required to produce a good or service, including materials, labor, and other expenses.

Units

Units refer to the basic measure or quantity of a product, service, or the fundamental quantity used in measurement.